Take a breather...Christmas is not the be all and end all and doesn't warrant taking on more debt, especially if things are already tight. Ask yourself, would those few extra decorations or extra large turkey really make the day any more memorable? That new in-toy may seem like an absolute must, but chances are it will probably be forgotten about and popped in the cupboard under the stairs before Easter and you will be still paying back your loan. Just take some time to have a think.
Alternatives to a Christmas loan
Before resorting to finance, here are some alternatives that will help you with the cost of Christmas and help to ensure you’re not spending above your means.
1 - Budget and make cuts
It’s natural to want to make Christmas big and memorable for your loved ones, but really there’s no need - after all, the season is about the people, not the presents. Take a look at what you’re planning to spend and make cuts where you can. Try a cheaper supermarket for food, search for gift deals and go for minimalist decorations this year.
We’ve put together a guide to planning for Christmas that will come in handy, with tips on budgeting and spreading the seasonal cost, even during December.
2 - Sell things on Ebay
Have you still got gifts from last year bundled into the back of your wardrobe? Chances are there’s items throughout the home that you might not need, so take a look and see what you’ve not used for a while. Just think of it as starting your spring cleaning a little early and you can use the extra cash to put towards Christmas.
People are on the lookout for bargains and, as they say, one man’s trash is another man’s treasure. Popular sites to list things are Gumtree, Ebay and Facebook Marketplace and, if you’re looking to sell good-quality clothes then try the app, Depop.
3 - Part time Christmas work
The run up to Christmas is such a busy time for retailers and businesses, that they are almost always on the hunt for a few extra seasonal part time staff. Update your CV and take it to shops, restaurants, bars and businesses, to see if there are any positions going - chances are they’ll be glad of the extra help.
If you’re not comfortable in front of customers then that’s no issue. Look for warehouse jobs in your area - you might find that there’s packing and shipping work that needs to be done. Part time jobs can often pay weekly, so you can plan what you need to get with the extra cash and who knows, it could turn into something permanent in the new year.
4 - Secret Santa
If your family are all finding the cost of Christmas tough, then you could suggest a secret Santa, rather than having to get gifts for everyone. Set the budget to suit everyone and it could end up being a pretty interesting Christmas morning!
It’s common for people to feel the pinch during the festive season and many would be happy to take part in the Secret Santa but may not want to suggest it - now is your moment!
I've decided I am going to borrow, what should I do?
If you’ve done everything in your power to cut costs, budget and provide a Christmas that suits your finances but you’re still falling short, you may have decided that you want to take out a Christmas loan. If so, you’ll need to think very carefully about whether it’s the right decision for you.
Preparation is super important
As with all finance, you need to look at your circumstances before you apply, so that you know where you stand. Take a look at your credit score and make sure you work out whether you can afford to take on monthly repayments.
Compare loans to find the best option
Finding a short term loan to suit your circumstances is also important. You don’t want to apply for lots of different lenders and be declined as this could affect your credit file and make it more difficult for you to get credit in the future. Compare lenders and find the best option for you, by taking a look at our loan comparison tables.
Would a credit card be better?
It might also pay to take the time and see whether a bad credit credit card works out cheaper. Comparing cards with a 0% introductory purchase period means that you won’t have to pay interest on things you’ve bought for a set period of time, which will hopefully give you time to pay off the balance. But be warned, it can become very expensive if you’ve not cleared anything outstanding by the time the 0% period is up.
Do bear in mind that if you have bad credit, you might be better off not taking on any extra debt. Our borrowing with bad credit guide has more information on understanding your financial position and ability to borrow.
There are so many things you can do to cut the cost of Christmas before you resort to borrowing. Don’t forget that even though it may seem like a good idea before Christmas, you’ll be paying for it well after the big day is over, which could take some of the shine off your memories.